State of play, main conclusions, outlook

The Commission proposed a revision of the Package Travel Directive in 2013 (COM (2013)0512). The revision was adopted by the legislator in 2015. The Directive aimed to reduce consumer detriment by clarifying which combinations of travel services are protected under EU package travel rulesand to establish a level playing field between operators. The objective was also to replace unclear and outdated provisions and to reduce compliance costs for businesses and remove legal obstacles to cross-border trade.

 The 2015 Directive includes:

• A broader definition of packages, including so-called ‘dynamic packages’, plus the creation of the new category of linked travel arrangements (LTAs);

• New information requirements for the benefit of travellers;

• More predictable prices: establishment of an 8% cap for possible price increases by the trader, beyond which the traveller has the right to cancel their holiday free of charge;

• Stronger cancellation rights for travellers, either against a reasonable fee or without a cancellation fee in cases where unavoidable and extraordinary circumstances significantly affect the performance of the package;

• Clear identification of the liable party;

• Clarification on essential consumer rights, including on liability for inadequate performance, assistance for travellers in difficulty and booking errors.

The Commisison is carrying out an evaluation to assess whether the 2015 Directive has achieved its main objectives and whether it ensures the proper functioning of the internal market and robust and compresensive consumer protection in the package travel market at all times, i.e. including in crises, such as COVID-19. The impact assessment will examine policy options addressing any shortcomings identified in the evaluation. The main objective will be to ensure a high level of consumer protection, including in times of crisis, most likely through adding clarifications and closing gaps in the Directive. In addition, the potential for reducing complexity and simplification will be examined.

The Commission adopted a general report on the application of this Directive on 26.2.2021.

To support the Commission, among other things, in the preparation of those reports, the Commission has set up an expert group on package travel and linked travel arrangements composed of experts representing EU business organisations active in the travel sector, national/EU organisations representing consumers and travellers, national alternative dispute resolution bodies specialised in travel and tourism and entities providing insolvency protection for the travel sector.

Estimated savings and benefits

At the time of the Commission proposal in 2013, the Directive was expected to reduce detriment to consumers by about EUR 430 million a year.

While increasing business costs for some companies, the Directive was expected to reduce overall costs for businesses by EUR 475 million per year through:

• Abolishing outdated requirements to reprint brochures, thereby saving tour operators and travel agents an estimated EUR 390 million per year;

• Excluding managed business travel from the Directive, which is expected to lead to savings of up to EUR 76 million per year;

• Furthermore, harmonised information requirements are expected to lead to one-off cost savings of EUR 21 million and to annual cost-savings of EUR 5.1 million.

In the course of the ongoing evaluation, the Commission will update its analysis of savings and benefits.

Fit for Future Platform

The Fit for Future Platform’s opinion on this Directive, as adopted on 22 March 2022, contains the following suggestions:

Suggestion 1: Better information on the identity of the contractual partners and on contact details and better enforcement of rules

Suggestion 2: Clarification of scope and simplification of the definitions of package and Linked Travel Arrangement

Suggestion 3: Clarification of pre-contractual information requirements (Art 5)

Suggestion 4: Clarification of uncertainties regarding insolvency protection

Suggestion 5: Clarification 'other tourist services’

 

According to the Platform, despite the mandatory information requirements established by the directive, travellers are, in practice, not always fully aware of the identity of the the organiser, retailer and service providers and their role in relation to a package. In its on-going evaluation and impact assessment, the Commission will assess whether and how increased clarity for travellers can be achieved without placing unnecessary burden on businesses.

The Platform raises the issue of clarifying the scope and simplifying the definitions of package and linked travel arrangements (LTAs). The combined roadmap¹ and inception impact assessment published by the Commission on 6 August 2021 refers to the scope of the Directive, as well as to the complexity and uncertainties related to the concept of LTAs and its delimitation from packages amongst the issues to be examined. The ongoing evaluation and impact assessment will continue to examine this issue, integrating also the suggestions from the Platform.

The Platform also asks the Commission to consider how specific information requirements could be made easier to handle in practice for travellers and companies (Article 5 of the Directive). The Commission will indeed, in line with the suggestion continue to examine this aspect in the ongoing evaluation and impact assessment.

The Platform also refers to the need to further specify the scope of insolvency protection, in particular in times of crisis, such as the COVID-19 pandemic, as well as on re-bookings and vouchers. Different aspects relating to insolvency protection are covered by the ongoing evaluation and impact assessment. This exercise covers, for instance, the examination of questions related to the scope of insolvency protection, in particular with regard to vouchers and refund claims, the preparedness for a liquidity crisis and possible limitations of pre-payments. These aspects will be included in the ongoing evaluation and impact assessment.

Finally, the Platform outlines the difficulty in identifying a particular service as ‘other tourist service’. Therefore, the Platform asks the Commission to clarify the term of ‘other tourist service’, which is a sub-category of the term ‘travel service’ and assess the best manner to achieve this. The definition of ‘travel service’ is covered by an open question in the ongoing public consultation and this question will therefore be considered in the ongoing evaluation and impact assessment.

¹ https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/13117-Package-travel-review-of-EU-rules_en